ServiceNow Inc (NOW)
Debt-to-capital ratio
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 1,488,000 | 1,487,000 | 1,487,000 | 1,486,000 | 1,486,000 | 1,485,000 | 1,485,000 | 1,484,000 | 1,484,000 | 1,484,000 | 1,483,000 | 1,611,000 | 1,640,000 | 1,705,530 | 696,123 | 701,288 | 694,981 | 686,516 | 678,145 | 669,875 |
| Total stockholders’ equity | US$ in thousands | 7,628,000 | 7,182,000 | 6,926,000 | 5,600,000 | 5,032,000 | 4,523,000 | 4,194,000 | 3,997,000 | 3,695,000 | 3,534,000 | 3,275,000 | 3,037,000 | 2,834,000 | 2,674,000 | 2,479,000 | 2,266,000 | 2,127,000 | 1,429,470 | 1,260,950 | 1,194,950 |
| Debt-to-capital ratio | 0.16 | 0.17 | 0.18 | 0.21 | 0.23 | 0.25 | 0.26 | 0.27 | 0.29 | 0.30 | 0.31 | 0.35 | 0.37 | 0.39 | 0.22 | 0.24 | 0.25 | 0.32 | 0.35 | 0.36 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $1,488,000K ÷ ($1,488,000K + $7,628,000K)
= 0.16
The debt-to-capital ratio for ServiceNow Inc has shown a declining trend over the past eight quarters, indicating a decreasing reliance on debt relative to total capital. This ratio measures the proportion of the company's capital structure that is financed by debt, and the decreasing trend suggests that the company has been utilizing less debt in relation to its overall capital.
As of December 31, 2023, the debt-to-capital ratio stands at 0.16, which means that only 16% of the company's total capital is financed by debt. This indicates a relatively low level of debt compared to the capital structure. The gradual decline in the ratio from 0.28 in March 31, 2022, to 0.16 in December 31, 2023, suggests that the company has been able to reduce its reliance on debt to fund its operations and growth initiatives over this period.
The declining trend in the debt-to-capital ratio may signify a positive development in the company's financial management, as a lower reliance on debt could lead to reduced interest expenses and lower financial risk. However, it is essential to consider the overall context, including the company's growth plans and profitability, to fully assess the implications of the decreasing debt-to-capital ratio.
Peer comparison
Dec 31, 2023